The Jersey City Independent "

Thursday’s City Council meeting, the first of the 2011 fiscal year, also marked the beginning of the council’s summer hours, when caucuses and meetings are held at 10 am. It was a regular meeting of the council although there was no caucus and it didn’t take place at the usual time. About a dozen people, most of them city employees, were present to observe the proceedings as the council considered four resolutions; no ordinances were considered. Ward E councilman Steven Fulop was absent. The meeting started nearly an hour late but lasted only about forty minutes.

The meeting started on a high note as the council serenaded city clerk Robert Byrne with a round of “Happy Birthday.” Byrne turned 51 on Thursday.

Temporary Budget Approved

The primary purpose of the annual July 1 meeting is to approve the temporary budget, which the city uses to operate in the absence of an approved budget for the fiscal year. The council did so by a vote of 6-2, approving appropriations amounting to more than $168 million, of which nearly $61.5 million is set aside for debt service. Ward C councilwoman Nidia Lopez and Ward F councilwoman Viola Richardson both voted no on the measure.

Lopez recalled her vote against the 2010 budget at an April council meeting as she cast her nay, saying she wants the council to bring the council a proposed budget soon in order to “make intelligent decisions on behalf of our constituents.”

Richardson said the administration needs to do more to show it is trying to rein in the budget.

“We’ve been playing around long enough,” Richardson said. She called for “real serious adjustments” to the budget, including cutting city spending on “consultants and all these contracts.”

Ward B councilman David Donnelly, who like Lopez voted against the final budget for the 2010 fiscal year, voted in favor of the budget but warned that he “can’t continue to vote for temporary budgets.”

Ward D councilman Bill Gaughan, before casting an aye on the temporary budget, asked business administrator Jack Kelly to see that the administration has a budget plan to present to the council within about two months, by the first meeting in September.

Although Ward E councilman Steven Fulop was not present at the council meeting, he did share his thoughts on the temporary budget with JCI. A consistent critic of the city’s practice of operating with a temporary budget, Fulop has repeatedly voted against temporary appropriations during the months when a final budget is not yet approved.

“What I’d like to see is some kind of budget through the whole year,” Fulop said. “I’m not comfortable voting on these temporary appropriations.” He added that any attempts to reduce spending are “window-dressing” in the absence of timely budget planning.

Two other items on Thursday’s agenda related to the start of the new fiscal year. A resolution to certify the municipal tax levy for the third and fourth quarters of the 2010 calendar year was approved over some council members’ objections and the city’s cash management plan for the 2011 fiscal year was unanimously adopted; both items were amended by the council before their adoption.

Before the vote on the third- and fourth-quarter tax levy, Ward A councilman Michael Sottolano moved to amend the bill. While the tax levy in the original resolution was set at $220 million, Sottolano said it was too high and requested it be reduced to $200 million — a figure that still represents an increase of $15 million over the levy for the first two quarters. All council members voted for the amendment except Richardson, who abstained saying that a reduction of $20 million was not enough.

“We can’t expect people to pay these kinds of taxes,” Richardson said.

Kelly indicated that the revised tax levy of $200 million would represent an increase of “approximately $720 to the average taxpayer’s tax bill.” However, he added that reducing the proposed levy “will set the tone for this fiscal year” and send “a clear message” to the administration. Kelly pointed out that the city — which has faced steep budget gaps in the past few years — is once again staring down a significant revenue shortfall this year, which he estimated at about $53 million. Bearing in mind the severe cuts in municipal aid to be expected from Gov. Christie’s administration, as well as reductions in revenue from other sources, Kelly said that the city will need to be “serious about reducing the size of government.”

Once amended, the resolution to certify the tax levy was adopted by a vote of 5-3, with Donnelly, Lopez and Richardson voting against it.

“I didn’t want to be stuck with a $220 million levy; however, I am not happy or satisfied with the way this came about,” Donnelly said. “I honestly don’t even know if this levy is responsible, so I can’t vote for it.”

Lopez said it was impossible for her to vote for a tax levy that called for an increase to taxpayers of $720. That sum “is gonna be very difficult for them,” she said as she cast her nay.

Council President Peter Brennan, while indicating he is not happy with an increase in the tax levy, said that capping it at $200 million was the right move.

“I want the administration to come back and tell us that they are gonna start reducing departments,” Brennan said. He added that he is disappointed about the fact that this council is “known as the ‘tax council.’”

Bank of America Boycott

Aside from the approval of the tax levy, the other resolution relating to the 2011 budget on Thursday’s agenda was the adoption of the city’s cash management plan, which provides for the investment of city funds in interest-bearing accounts and other types of liquid investments. Although the plan was adopted unanimously, it was amended twice before its final approval.

The plan designates a list of banks that the city is permitted to do business with, and the original resolution included Bank of America (BOA) on this list. Councilwoman Richardson asked her colleagues to support a motion to amend the resolution to remove BOA from the list on the grounds that their decision to merge the former branch at the HUB on Martin Luther King Drive with another on Route 440 left the Bergen-Lafayette section underbanked.

Councilman Donnelly has also spoken out against BoA in the past, warning at a May council meeting that he would vote against future measures to deposit money in the bank “unless they start to treat the city better.”

Noting that she has requested the city divest from BOA in the past, Richardson said that she was told by administration officials that it would be necessary to wait until the start of the next fiscal year to do so. She did not miss the date.

“I don’t care if we have two cents in that bank,” Richardson said as she moved to amend the resolution. “I am asking the business adminstrator to delete Bank of America from this list.”

All of the other council members present voted in favor of the amendment and passed the revised resolution, but Councilman Sottolano raised concerns about the status of the city’s accounts with the bank and whether the new law would require the city to remove its funds from the bank with a haste that could disrupt city business.

Kelly expressed the opinion that the city would be able to proceed according to “the policy of reasonableness.” While allowing that “we obviously can’t pull the plug immediately,” he told the council that the city would “work on winding our relationship down.”

City attorney Bill Matsikoudis agreed with Kelly that in the most likely scenario the city would have enough time to sever the relationship within a reasonable timeframe. However, he said that it would be best for the resolution “to speak to what will actually occur,” and recommended that the council reconsider the resolution and amend it a second time, inserting a date by which all business with Bank of America should end — Kelly suggested September 30 as a workable date.

The council voted to reconsider the resolution, approved the further amendment and finally voted once again to adopt the amended measure.

After the series of votes was completed, city clerk Robert Byrne quipped that he didn’t recall “as complicated a meeting for four resolutions, ever.”

Odds and Ends

• The council unanimously approved one additional resolution, to execute a grant agreement with the county Tourism Development office, which will provide the city with nearly $4,500 for the annual Summerfest concert series in Liberty State Park.
• A resolution to establish the city’s official depositories was withdrawn by Kelly, who said it was “redundant” given that the cash management plan resolution effectively designates the banks in which the city can deposit funds.
• A resolution to grant a permit to Pyrotecnico Fireworks for the Hyatt Regency hotel’s fireworks display on July 10 was withdrawn; Byrne told the council that Pyrotecnico “lost their contract” with the hotel and no longer needs the permit.

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